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Evoke Pharma(EVOK) - 2025 Q1 - Quarterly Report
Evoke PharmaEvoke Pharma(US:EVOK)2025-05-13 20:20

PART I. FINANCIAL INFORMATION Item 1. Financial Statements The company's unaudited statements show sales growth but also net losses and substantial doubt about its going concern status Condensed Balance Sheets Total assets and stockholders' equity decreased as of March 31, 2025, primarily due to a reduction in cash Condensed Balance Sheet Data (Unaudited) | Account | March 31, 2025 | December 31, 2024 | | :--- | :--- | :--- | | Cash and cash equivalents | $12,624,090 | $13,596,600 | | Total current assets | $16,230,875 | $17,237,897 | | Total assets | $16,375,945 | $17,519,007 | | Total current liabilities | $10,451,513 | $10,380,039 | | Total liabilities | $10,534,730 | $10,480,997 | | Total stockholders' equity | $5,841,215 | $7,038,010 | Condensed Statements of Operations Net product sales grew significantly year-over-year, while the net loss per share improved Q1 2025 vs Q1 2024 Statement of Operations (Unaudited) | Metric | Three Months Ended March 31, 2025 | Three Months Ended March 31, 2024 | | :--- | :--- | :--- | | Net product sales | $3,080,158 | $1,735,490 | | Loss from operations | $(1,301,743) | $(1,501,220) | | Net loss | $(1,306,178) | $(1,579,820) | | Net loss per share, basic and diluted | $(0.51) | $(2.09) | Condensed Statements of Cash Flows Net cash used in operations decreased significantly, though financing activities provided minimal cash in Q1 2025 Q1 2025 vs Q1 2024 Cash Flow Summary (Unaudited) | Cash Flow Activity | Three Months Ended March 31, 2025 | Three Months Ended March 31, 2024 | | :--- | :--- | :--- | | Net cash used in operating activities | $(997,509) | $(2,579,390) | | Net cash provided by financing activities | $24,999 | $7,542,719 | | Net (decrease) increase in cash | $(972,510) | $4,963,329 | | Cash and cash equivalents at end of period | $12,624,090 | $9,702,755 | Notes to Condensed Financial Statements Notes highlight a going concern risk, dependency on its sole product, and details of its partner agreement with Eversana - Management has concluded there is substantial doubt about the Company's ability to continue as a going concern for one year, due to recurring losses, negative cash flows, and the potential for its partner Eversana to terminate their agreement and demand repayment of a $7.2 million loan within 90 days23 - A 1-for-12 reverse stock split was effective on August 1, 2024, and all share and per-share data have been retroactively adjusted2627 - Under the Eversana agreement, Evoke records sales for Gimoti and retains over 80% of net product profits after both parties' costs are reimbursed, with unreimbursed commercialization costs owed to Eversana at approximately $77.5 million as of March 31, 202574 - The company has a $5.0 million revolving credit facility from Eversana, with $7.2 million outstanding including interest as of March 31, 2025, which is classified as a current liability due to the risk of accelerated repayment237880 Management's Discussion and Analysis of Financial Condition and Results of Operations Management discusses strong sales growth for Gimoti®, ongoing going concern risks, and its current liquidity position - The company's existing cash of $12.6 million is expected to fund operations into Q2 2026, but this forecast excludes the potential early repayment of the Eversana loan, leading to substantial doubt about its ability to continue as a going concern97 - The company regained compliance with Nasdaq's minimum bid price and minimum stockholders' equity requirements but is subject to a discretionary panel monitor through June 4, 202598101 Gimoti Sales Metrics - Q1 2025 vs Q1 2024 | Metric | Change | Detail | | :--- | :--- | :--- | | Net Product Sales | +77% | $3.1M in Q1 2025 vs $1.7M in Q1 2024 | | New Inbound Prescriptions | +25% | 1,793 new prescriptions in Q1 2025 | | Refill Rate | ~70% | For patients who have completed their first fill | | New Prescribers | +9.6% | Cumulative increase during Q1 2025 | Results of Operations Q1 2025 saw a 77% increase in net product sales, offset by higher SG&A expenses tied to marketing and profit sharing Comparison of Operations for Three Months Ended March 31, (2025 vs 2024) | Item | 2025 | 2024 | $ Change | % Change | | :--- | :--- | :--- | :--- | :--- | | Net product sales | $3,080,158 | $1,735,490 | $1,344,668 | 77% | | Cost of goods sold | $41,613 | $92,529 | $(50,916) | -55% | | Research and development expenses | $42,783 | $4,645 | $38,138 | 821% | | Selling, general and administrative expenses | $4,297,505 | $3,139,536 | $1,157,969 | 37% | - The increase in SG&A was primarily due to a $1.2 million rise in marketing and Eversana profit sharing directly resulting from increased net product sales121 Liquidity and Capital Resources The company faces significant liquidity risk from a potential loan acceleration by its partner, creating substantial going concern doubt - The company has a $5.0 million revolving credit facility from Eversana, with $7.2 million outstanding including interest as of March 31, 2025, and repayment could be accelerated if Eversana exercises its termination right (NPQTR)124125 - Management believes there is substantial doubt about the company's ability to continue as a going concern for one year due to the risk of the Eversana loan acceleration and ongoing losses125 Cash Flow Summary Change (Q1 2025 vs Q1 2024) | Cash Flow Activity | Q1 2025 | Q1 2024 | $ Change | | :--- | :--- | :--- | :--- | | Net cash used in operating activities | $(997,509) | $(2,579,390) | $1,581,881 | | Net cash provided by financing activities | $24,999 | $7,542,719 | $(7,517,720) | Quantitative and Qualitative Disclosures about Market Risk The company is exempt from this disclosure requirement as a smaller reporting company - The company is not required to provide information for this item as it qualifies as a smaller reporting company131 Controls and Procedures Management concluded that disclosure controls and procedures were effective with no material changes to internal controls - Based on an evaluation as of March 31, 2025, the Chief Executive Officer and Chief Financial Officer concluded that the company's disclosure controls and procedures were effective at a reasonable assurance level134 - No changes in internal control over financial reporting occurred during the quarter ended March 31, 2025, that materially affected, or are reasonably likely to materially affect, internal controls135 PART II. OTHER INFORMATION Legal Proceedings The company reports no current legal proceedings - None137 Risk Factors A new risk factor was added concerning potential impacts from U,S, tariff and import/export regulations - A new risk factor has been added regarding changes to U.S. tariff and import/export regulations, which could negatively affect the business due to reliance on international third-party manufacturers for Gimoti in Italy and France138 Unregistered Sales of Equity Securities and Use of Proceeds The company reports no unregistered sales of equity securities during the period - None139 Other Information No officers or directors adopted, modified, or terminated Rule 10b5-1 trading plans during the quarter - No officers or directors adopted, modified, or terminated any Rule 10b5-1 trading plans during the three months ended March 31, 2025140 Exhibits This section lists all exhibits filed with the report, including officer certifications and XBRL data